China-ASEAN Information Harbor Boosts Online Connectivity

By Wang Jiping

E-commerce has taken up an important role in trade across the world, and since the economic and trade relationship between China and ASEAN is developing quickly, the establishment of an international communication center specifically focused on bilateral trade is badly needed.

The establishment of several such initiatives is already underway. Several proposals and plans were showcased at the 13th China-ASEAN Expo and the 13th China-ASEAN Business and Investment Summit in Nanning, the capital of Guangxi Zhuang Autonomous Region, in early September. Such projects include the China-ASEAN Information Harbor, which is being constructed in Guangxi with the aim of promoting online and multilateral development and cooperation within the region.

Mutual Benefits

These days, China is enlarging its online trading with ASEAN countries, and e-commerce has become an area in which China and ASEAN improve practical cooperation in a variety of different fields, according to Jia Shuying, deputy director of the Department of Electrionic Commerce and Informatization at the Chinese Ministry of Commerce. Jia, who spoke at the summit, said that e-commerce lowers the cost of doing business by improving efficiency. Conducting e-commerce with ASEAN countries where market competition is less fierce (compared to Western countries) is favored by Chinese foreign trade companies.

E-commerce trade volume in China reached 20.8 trillion yuan (US$3.1 trillion) in 2015, a year-on-year increase of 27 percent. Online retail sales reached 3.88 trillion yuan (US$570 billion), a year-on-year increase of 33 percent. From January to July this year, that number reached 2.6 trillion yuan (US$389 billion), representing a year-on-year increase of 27.5 percent. China has become the world’s largest online retail market. At the same time, China’s cross-border e-commerce is growing fast. In 2015, total trade volume reached 4.56 trillion yuan (US$683 billion), a year-on-year increase of 21.7 percent.

As a port for internet connectivity, information sharing, wealth pooling and cultural integration, the China-ASEAN Information Harbor can be used by China and ASEAN countries to enable win-win cooperation.

China needs to maintain its vigor in e-commerce development, and by cooperating with China, ASEAN countries could do more to open up and learn about new technologies such as online payments systems, Jia said.

As a port for internet connectivity, information sharing, wealth pooling and cultural integration, the China-ASEAN Information Harbor can be used by China and ASEAN countries to enable win-win cooperation, said Li Heng, vice-president of the China-ASEAN Information Harbor Company. Preliminary connectivity is set to be realized within the next two years with the establishment of an online network of international goods information, Li added.

China first proposed the establishment of the Information Harbor in September 2014. The initiative includes five cooperative platforms beneficial to China and ASEAN member states, covering infrastructure, information sharing, technological innovation, trade services and cultural exchange. According to China’s plan, a base for the China-ASEAN Information Harbor will be established in the city of Nanning, and will consist of 34 projects worth a total of 20.9 billion yuan (US$3.1 billion). Guangxi has already begun carrying out Chinese President Xi Jinping’s instructions with regards to positioning Guangxi in this new historic period so that the region can serve as a point of passage between China and ASEAN countries. It is also set to serve as a regional strategic stronghold of development and a pivotal portal in the Belt and Road Initiative, promoting construction of the information harbor.

Li also predicted that by 2020, the initial frame of the harbor will be completed, which will do much to ensure full connectivity between the two sides, and promote bilateral development in fields such as the economy, culture and society. In other words, the harbor will promote internet penetration and break the information barrier known as the “digital gap”.

 

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A worker moving goods to be sold online.

 

Benefiting Bilateral Enterprises

“Information plays a key role in trade, so I am longing for the full establishment of the China-ASEAN Information Harbor,” said Dung Hung, deputy director of Vietnam’s Biti’s Group, a shoe retailer.

“The main products we are promoting this year are plastic slippers for adults and canton sandals for boys, girls and babies,” Dung said. “Considering both costs and consumers’ purchasing power, it is still hard for producers to add greater margins to articles of common, daily use. Our sales rely on designing shoes in a wide variety of patterns and colors before selling them as fast as possible. Undoubtedly, e-commerce suits our needs.”

Dung said that e-commerce helps to save money on rent, personnel, water and electricity. It also helps to build links with other companies in the same industry, collect data to learn about consumers’ preferences and improve the sales system to be more suited towards customers’ needs.

“I think the harbor will provide more facilities for logistics,” said Chen Shuli, CEO of Guangdong Yixi Dairy Company’s Department of Import. Chen’s company’s products include fresh milk and cheese.

“With the establishment of the harbor, Guangxi will turn into a smart region with a faster system of logistics, which will help keep our products as fresh as possible,” Chen said.

Chen added that along with the establishment of the harbor, the government could simplify customs clearance procedures and release apps that will display instant investment, import and export information regarding ASEAN countries.

“Maintaining freshness is one of the biggest challenges in the fresh food industry,” Chen said. “In order to attract more consumers, we must diversify our products. There is much room for us to cooperate with Malaysia, Indonesia, Singapore and Thailand. We could not only import competitive products from those countries into China, but also do research on how companies there operate.”

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